Vietnam targets spending deficit at 3.7% of GDP in 2018

NDO - The National Assembly of Vietnam has approved the budget for 2018 which aims for the expenditure deficit at VND204 trillion (US$9 billion), equivalent 3.7% of gross domestic product.

The resolution on the 2018 budget was passed on November 13 by more than 86% of parliamentarians.

Under the resolution, Vietnam will need to borrow more than VND360 trillion to cover the deficit and pay debts.

The government is required to enforce laws on taxes and fees properly, step up tax administrative reforms, create a conducive business climate, prevent trade frauds and strive to reduce the ratio of tax arrears to a total revenue below 5%.

The National Assembly also asked 72% of the profit earned by Vietnam from the Vietsovpetro joint venture to be paid to the nation’s coffers while the remaining 28% will be returned as investment to PetroVietnam.

The budget resolution also stipulates that the base wage will increase from the current VND1.3 million a month to VND1.39 million from July 1, 2018.

The central government ministries, agencies and local authorities are requested to minimise their spending and restructure their workforce to ensure that the base wage increase will not affect their budget for salary.